escrow

Escrow

Something of value, such as a deed, stock, money, or written instrument, that is put into the custody of a third person by its owner, a grantor, an obligor, or a promisor, to be retained until the occurrence of a contingency or performance of a condition.

An escrow also refers to a writing deposited with someone until the performance of an act or the occurrence of an event specified in that writing. The directions given to the person who accepts delivery of the document are called the escrow agreement and are binding between the person who promises and the person to whom the promise is made. The writing is held in escrow by a third person until the purpose of the underlying agreement is accomplished. When the condition specified in the escrow agreement is performed, the individual holding the writing gives it over to the party entitled to receive it. This is known as the second delivery.

Any written document that is executed in accordance with all requisite legal formalities may properly be deposited in escrow. Documents that can be put in escrow include a deed, a mortgage, a promise to pay money, a bond, a check, a license, a patent, or a contract for the sale of real property. The term escrow initially applied solely to the deposit of a formal instrument or document; however, it is popularly used to describe a deposit of money.

The escrow agreement is a contract. The parties to such an agreement determine when the agreement should be released prior to making the deposit. After the escrow agreement has been entered, the terms for holding and releasing the document or money cannot be altered in the absence of an agreement by all the parties.

A depositary is not a party to the escrow agreement, but rather a custodian of the deposit who has no right to alter the terms of the agreement or prevent the parties from altering them if they so agree. The only agreement that the depositary must make is to hold the deposit, subject to the terms and conditions of the agreement. Ordinarily, the depositary has no involvement with the underlying agreement; however, an interested party may, in a few states, be selected to be a depositary if all parties are in agreement. In all cases, a depositary is bound by the duty to act according to the trust placed in him or her. If the depositary makes a delivery to the wrong person or at the wrong time, he or she is liable to the depositor. The document or the money is only in escrow upon actual delivery to the depositary. Ordinarily, courts are strict in their requirement that the terms of the agreement be completely performed before the deposit is released. A reasonable amount of time must generally be allotted for performance. Parties may, however, make the agreement that time is of the essence, and in such a case, any delay beyond the period specified in the agreement makes the individual who is obligated to act forfeit all his or her rights in the property in escrow.

escrow

1) n. a form of account held by an "escrow agent" (an individual, escrow company or title company) into which is deposited the documents and funds in a transfer of real property, including the money, a mortgage or deed of trust, an existing promissory note secured by the real property, escrow "instructions" from both parties, an accounting of the funds, and other documents necessary to complete the transaction. When the funding is complete and the deed is clear, the escrow agent will then record the deed to the buyer and deliver funds to the seller. The escrow agent or officer is an independent holder and agent for both parties who receives a fee for his/her/its services. 2) n. originally escrow meant the deed held by the escrow agent. 3) n. colloquially, the escrow agent is called an "escrow," while actually the escrow is the account and not a person. 4) v. to place the documents and funds in an escrow account, as in: "we will escrow the deal." (See: escrow agent)

escrow

escrow

1 a deed delivered to a third party to hold until fulfilment of a condition, when it will be delivered; e.g. a conveyance executed by a vendor of property and delivered to his solicitor pending completion by the purchaser's paying the purchase price.

2 more generally a service which offers to hold something for a seller pending payment of the price.

ESCROW, conveyancing, contracts. A conditional delivery of a deed to a
stranger, and not to the grantee himself, until certain conditions shall be
performed, and then it is to be delivered to the grantee. Until the
condition be performed and the deed delivered over, the estate does not
pass, but remains in the grantor. 2 Johns. R. 248; Perk. 137, 138.
2. Generally, an escrow takes effect from the second delivery, and is
to be considered as the deed of the party from that time; but this general
rule does not apply when justice requires a resort to fiction. The relation
back to the first delivery, so as to give the deed effect from that time, is
allowed in cases of necessity, to avoid injury to the operation of the deed,
from events happening between the first and second delivery. For example,
when a feme sole makes a deed and delivers it as an escrow, and then marries
before the second delivery, the relation back to the time when she was sole,
is necessary to render the deed valid. Vide 2 Bl. Com. 307; 2 Bouv. Inst. n.
2024; 4 Kent, Com. 446; Cruise, Dig. t. 32, c. 2, s. 87 to 91; Com. Dig.
Fait, A 3; 13 Vin. Ab. 29; 5 Mass. R. 60; 2 Root, R. 81; 5 Conn. R. 113; 1
Conn. R. 375; 6 Paige's R. 314; 2 Mass. R. 452; 10 Wend. R. 310; 4 Green].
R. 20; 2 N. H. Rep. 71; 2 Watts', R. 359; 13 John. R. 285; 4 Day's R. 66; 9
Mass. R. 310 1 John. Cas. 81; 6 Wend. R. 666; 2 Wash. R. 58; 8 Mass. R. 238;
4 Watts, R. 180; 9 Mass. Rep. 310; 2 Johns. Rep. 258-9; 13 Johns. Rep. 285;
Cox, Dig. tit, Escrow; Prest. Shep. Touch. 56, 57, 58; Shep. Prec. 54, 56; 1
Prest. Abst. 275; 3 Prest. Ab. 65; 3 Rep. 35; 5 Rep. 84.

79-91, an escrow agreement in which a seller has no right to or interest in the escrowed funds unless and until the buyer defaults on the installment obligation does not impose a substantial restriction.

461(f)(2) requirement (dealing with the transfer of money or other property to provide for the satisfaction of an asserted liability), the court agreed with Varied that the escrow agreement did not need to be signed by the claimant to qualify under Sec.

2 million shares of the Company's common stock into a newly established escrow account with Continental Stock Transfer & Trust (the "Escrow Shares") along with an executed stock power in blank, pursuant to the escrow agreement.

Having determined that WWE has made sufficient progress payments to date towards its obligations under the Escrow Agreement, Coates is now taking steps to commence production and expects to have commercial electric power engine generators, engineered for use with alternative fuels including flare-off gas from oil wells, landfill gas and raw natural gas ("Coates Generators"), ready for pickup by WWE before the end of the current year.

As previously disclosed, in connection with the Fiat Sale Agreement, the Company executed an escrow agreement, dated July 25, 2007, as amended on August 3, 2007 (the "Fiat Escrow Agreement"), which provides that (i) EUR2 million of the remaining EUR5 million of the Fiat Payment shall be held "in escrow" for a period of up to 18 months from the closing of the Fiat Sale and in accordance with the terms of the Fiat Sale Agreement and the Fiat Escrow Agreement and (ii) the remaining EUR3 million of the Fiat Payment would be paid to the Company at the closing of the Fiat Sale.

The escrow agreement was established to provide a more secure mechanism for the Company to collect payments due under both the prior Canadian licensing and research and development agreements and the initial monies due under the new $50 million US License.

In connection with the private placement, Jiada Hu, Concept Venture's new Chief Executive Officer and largest stockholder, entered into an escrow agreement to secure a make good commitment that was made by Concept Ventures.

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